Instant issuance solutions

Unique options have varying benefits and costs.

by Chris Chronis

Today’s consumers are increasingly used to having instant access to everything they want, and credit union members often expect that same immediacy from their financial services − including debit and credit cards. Credit unions are evaluating the option of adding instant card issuance to their ongoing, central card issuance business so that members can either be issued a card immediately, or receive it later in the mail.

Being able to walk out of a branch with an activated card creates a positive member experience and impacts account performance. A 2007 Visa® Check Card Instant Issuance Study found that when compared to mailed cards, instantly issued cards were used seven to eight days earlier and posted a 30-day activation rate of 37 to 42 percent, compared to less than 1 percent for mailed cards. The study also found that cardholders with an instantly issued card made two to three more offline transactions and one to two more online transactions in the first 30 days.

A number of factors are fueling the interest in instant issue cards, including competitive pressures, the desire for an enhanced member experience, the need for incremental revenue and the threat of delivery changes to the postal delivery system.

According to the Mercator Advisory Group, more financial institutions are moving toward offering instant issue cards − especially for lost card replacement − to differentiate themselves in an increasingly competitive marketplace.

Options to Meet Card Issuance Needs

Determining whether to offer cards in the branch – and how – involves analyzing costs and benefits of the available options, and the services offered by a credit union’s central issuance bureau. Careful consideration should be given to an organization’s market drivers, return on investment, branch footprint, card volumes, and the pros and cons of the available solutions. Many credit unions find that a dual approach to card issuance – centrally issued cards for the majority of cards and an instant issue solution for new accounts and lost or stolen card replacement – works well.

There are three options for card issuance, with varying costs and benefits.

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